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Specializing in Affordable Health Insurance Plans in Georgia In Atlanta Call 770-396-9517 or Toll Free 1-877-711-8376
Specializing in Affordable Health Insurance Plans in GeorgiaIn Atlanta Call 770-396-9517 or Toll Free 1-877-711-8376

What is the difference between an HMO, POS, and PPO and what are they?

HMO, or Health Maintenance Organization.

An HMO is the broadest type of health coverage available. The deductible can be as low as $0 and many companies offer plans with no coinsurance.

Normally, an HMO has a co-pay for most services. The reason we say this is the most comprehensive coverage is that the co-pay covers most of the service that the physician or lab charges. When you go for an office visit, it's all-inclusive in most cases. Sometimes there is even a co-pay for a hospital stay or outpatient surgery. If you encounter coinsurance on an HMO, it usually will be in conjunction with a deductible for the hospital stay. HMO's usually fully cover the cost of physicals, where the other plans normally have a limit to what they will pay for a physical. A traditional HMO plan requires that the insured member get a referral before going to see a specialist with the exception of a Dermatologist, a Psychiatrist, and/or an OB/GYN specialist.

Advantages-The HMO offers the broader coverage with less out of pocket costs during the plan year.
Disadvantages-Primarily less choice in doctors and hospitals. Sometimes doctors in an HMO will be employees of the HMO and not in private practice. Treatment is sometimes in a clinical environment in these cases.

 

 

POS, or Point of Service

(meaning, your amount of benefit depends on the point of service, i.e. in or out of network). Most POS plans operate very similar to an HMO plan with one exception. So, lets start by looking at the HMO and POS "in network" benefits.

HMO and POS health insurance plans offer the broadest type of health coverage available. The deductible can be as low as $0 and many companies offer plans with no coinsurance.

Normally, a POS has a co-pay for most services. The reason we say this is the most comprehensive coverage is that the co-pay covers most of the service that the physician or lab charges. When you go for an office visit, it's all-inclusive in most cases. Sometimes there is even a co-pay for a hospital stay or outpatient surgery. If you encounter coinsurance on a POS plan, it usually will be in conjunction with a deductible for the hospital stay. POS plans usually fully cover the cost of physicals, where the other plans normally have a limit to what they will pay for a physical. A traditional POS plan requires that the insured member get a referral before going to see a specialist with the exception of a Dermatologist, a Psychiatrist, and/or an OB/GYN specialist. There is also an "out of network" benefit in the event that you see a provider who does not accept your insurance plan.

The big difference between an HMO insurance plan and a POS health insurance plan is that the member may utilize providers that are not in the POS network. Like a PPO insurance plan, the member has out of network benefit coverage which is usually a higher deductible and lower coinsurance benefit. These benefits mean that the insured pays more out of their pocket.

Advantages-The POS offers the broader coverage with less out of pocket costs during the plan year. It also has an out of network benefit.
Disadvantages-Primarily less choice in doctors and hospitals to utilize in-network benefits. However, with the increasing popularity of the HMO and POS plans, more physicians, hospitals, labs and other providers are now contracting to accept POS plans which gives much more choice to the insured.

 

PPO, or Preferred Provider Organization

 In order to get more providers to contract (or "accept") with the PPO health insurance plan, insurance companies negotiate higher paying contracts for the physicians, hospitals and other providers. These contracts result in a larger number of providers agreeing to contract with the PPO health plans. However, since the cost of administering these plans is higher, the insured will often be asked to pay more for the PPO health insurance plan than they would an HMO or POS plan.

A PPO health insurance plan almost always has a deductible, and coinsurance. If you stay within the network, there are also co pays for certain services where the deductible and coinsurance do not come into play. For example, an office visit might be a $20-$60 co pay without regard to a deductible or coinsurance. For a hospital stay, you would be responsible for the deductible and your portion of the coinsurance. A word of caution, the co pays are often not all inclusive. For example, an office visit co pay may mean just covers the physician's portion of the visit. Any lab or x-ray charges, will most likely apply towards your deductible and you would have to pay the charges.

Advantages- A PPO provides a great deal of choice of doctors and hospitals. Because of this, the PPO helath insurance plans have been the most popular plans in the past.
Disadvantages- Monthly health insurance premiums will be higher than HMO or POS plan options. Coverage is not as comprehensive as an HMO or POS and you will experience greater out of pocket expense.

 

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